The United States (US) President Donald Trump has announced that any country that engages in business with Iran will face a 25 per cent tariff on trade with the US.
"Effective immediately, any Country doing business with the Islamic Republic of Iran will pay a Tariff of 25% on any and all business being done with the United States of America," the US president said in a post on Truth Social on Monday.
Without providing any further details, Trump said, "This Order is final and conclusive."
Also Read | Venezuelan invasion makes US a rogue state
This tariff announcement comes amid Trump mulling military action against Iran over the protests.
Earlier in the day, White House Press Secretary Karoline Leavitt said, "Air strikes would be one of the many, many options that are on the table." She added that "diplomacy is always the first option for the president".
Key trade partners of Iran
The principal trade partners of Iran are China, Turkey, India, the UAE, Pakistan and Armenia.
China reacts
In strong opposition, China described the move as "unilateral coercive measures".
"China's position against the indiscriminate imposition of tariffs is consistent and clear. Tariff wars and trade wars have no winners, and coercion and pressure cannot solve problems," a spokesperson of the Chinese embassy in Washington said on X.
"China firmly opposes any illicit unilateral sanctions and long-arm jurisdiction, and will take all necessary measures to safeguard its legitimate rights and interests," the spokesperson added.
How will this affect India?
The largest trading partner for Iran is considered to be China; however, this will also affect India, the UAE and Turkey, which are also some of Iran's most significant trading partners.
Also Read | North Korea accuses US of undermining UN, calls actions 'criminal'
In addition, according to the Indian Embassy in Tehran, India exported $1.24 billion worth of goods to Iran and imported $0.44 billion worth of goods from Iran for FY 2024-2025, bringing the total trade to $1.68 billion (around Rs 14,000- Rs 15,000 crore).
The major share of exports from India to Iran was organic chemicals ($512.92 million), followed by edible fruit, nuts, peel of citrus fruit and melon ($311.60 million), and mineral fuels, oils and products of distillation ($86.48 million), according to a report from Trading Economics.
The United States has already imposed taxes as high as 50 percent on Indian goods linked to their purchase of Russian oil. The extra duties could raise tariffs to 75 per cent, making trade even more difficult. The two sides have been working for months to finalise a deal that would give New Delhi much-needed tariff relief.
